overdraft loans

Branch Employees Often Give False Info about Overdraft Fees: Consumer Groups (American Banker)

Only 14.3% of customers at big banks had overdraft coverage in 2011 and 2012, according to the Consumer Financial Protection Bureau.

But for the minority of consumers who do opt in, overdraft fees can be enormously expensive. Around 8% of consumers paid overdraft fees at least 10 times per year, which cost them an average of $380 annually, the CFPB says.

Bank overdraft programs cause widespread confusion, new report shows

Written by Dory Rand on August 4, 2014 - 3:12pm

Read the report

The four organizations conducted 64 mystery shopping visits at 39 bank branches in Chicago, Durham, New York City, and Oakland, including Bank of America, BB&T, BMOHarris, Capital One, Chase, Citi, SunTrust, and Wells Fargo. In Chicago, mystery shoppers visited Bank of America, BMO Harris, Chase, and Citi.

How Banks Sell Overdraft: Results of Overdraft Mystery Shopping in Four Key States

Written by Woodstock Institute, California Reinvestment Coalition, New Economy Project, Reinvestment Partners on August 1, 2014 - 10:53am

Four organizations—California Reinvestment Coalition of Oakland, CA; New Economy Project of New York, NY; Reinvestment Partners of Durham, NC; and Woodstock Institute of Chicago, IL—conducted 64 mystery shopping visits at 39 bank branches in Chicago, Durham, New York City, and Oakland. The four largest banks by deposit size in each city or state (California) were selected, including Bank of America, BB&T, BMO Harris, Capital One, Citibank, JPMorgan Chase, SunTrust, Union Bank, and Wells Fargo.

Overdraft: Against the Flow of Financial Inclusion and Economic Recovery Efforts

Written by Dory Rand on July 17, 2014 - 1:51pm

The report makes it clear that overdraft products are one of the reasons that people do not participate in the mainstream financial system and often end up paying more for financial transactions at alternative, non-bank financial services providers. We know from the Federal Deposit Insurance Corporation (FDIC)’s 2011 survey that half of the over 10 million unbanked households in America were formerly banked.

More welcome protections for overdraft loans, but not enough for bank payday loans

Both overdraft loans and bank payday loans are credit products offered by banks, but overdraft loans operate within more clearly proscribed limits than do bank payday loans. Consumers can’t simply walk into a bank branch and request an overdraft loan; overdraft loans happen automatically made when account holders make a transaction that pushes their balance below zero.

Wells Fargo improperly charged millions in overdraft fees, judge rules

For example, if a customer has $100 in their bank account at the start of the day and, over the course of that day, spends $10 on lunch, $20 on hardware, $50 on groceries, $5 on a magazine, and $35 on a parking ticket, Wells Fargo would not process the transactions in that order. Instead, at the end of the day, Wells Fargo would re-order the transactions so that the groceries were processed first. See how the customer would pay $70 more in overdraft fees with the largest-first method than the chronological method:

“Beyond Foreclosures” starts discussion on the wealth gap and how to address it

These are the kind of sobering statistics that experts presented to more than 100 representatives from community, research, financial, regulatory, and government groups at “Beyond Foreclosures: The Impact of the Financial Crisis on the Wealth Gap and Economic Opportunity.” Indeed, a staggering number of consumers lack sufficient access to banking services that would help them build wealth, do not have opportunities to build a positive credit history, and must resort to the costly and stigmatizing process of bankruptcy.

From the President: Woodstock addresses Chase CEO at Shareholder Meeting in NYC

Written by Dory Rand on May 20, 2010 - 12:00am

Since I do not own stock in Chase, I used a shareholder proxy kindly provided by colleague Adam Rust of the Community Reinvestment Association of North Carolina (CRA-NC) to gain entry (through tight security) to the shareholder meeting. When I got my turn at the microphone, I explained that, as a customer of Chase and its predecessor banks in Chicago for nearly 28 years, I want to be proud of the bank where I do business.

From the President: Illinois Community Investment Coalition fights for financial reform on Capitol Hill

Written by Dory Rand on March 10, 2010 - 12:00am

We must ensure that the result of negotiations is not a toothless and ineffectual regulator that lacks the resources and authority it needs to keep financial products safe, sustainable, and available.

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